Question 1

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. 
-Refer to Figure 9-7. Which of the following is a valid equation for Welsh producer surplus with trade?

Accepted Answer

The answer of Figure 9-7. The figure applies to the...

Question 2

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. 
-Refer to Figure 9-8. The price corresponding to the horizontal dotted line on the graph represents the price of cars

Accepted Answer

The horizontal dotted line represents the domestic equilibrium price of cars before trade is allowed.

Question 3

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. 
-Refer to Figure 9-7. With trade, Wales

Accepted Answer

The figure shows that at the world price (Pw), Wales has a domestic quantity supplied of QS1U1B11S1U1B0 and a domestic quantity demanded of QD1U1B6S1U1B0. This means that without trade, Wales would produce and consume QS1U1B11S1U1B0 units of cheese. However, with trade, Wales can export the difference between its domestic quantity supplied and domestic quantity demanded (QS1U1B11S1U1B0 - QD1U1B6S1U1B0 = QS1U1B5S1U1B0), which equals to QS1U1B12S1U1B0 - QS1U1B11S1U1B0 units of cheese. Therefore, the answer is B.

Question 4

Figure 9-6
The figure illustrates the market for roses in a country. 
-Refer to Figure 9-6. The amount of revenue collected by the government from the tariff is

Accepted Answer

The answer of Figure 9-6
The figure illustrates the market for...

Question 5

Figure 9-9 
-Refer to Figure 9-9. Producer surplus in this market after trade is

Accepted Answer

Producer surplus is the area above the supply curve and below the market price. After trade, producer surplus is the area B + C + D, which represents the difference between the market price and the minimum price that producers were willing to accept. Therefore, the correct answer is C.

Question 6

Figure 9-9 
-Refer to Figure 9-9. Consumer surplus in this market before trade is

Accepted Answer

The answer of Figure 9-9 
-Refer to Figure 9-9. Consumer...

Question 7

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. 
-Refer to Figure 9-7. Which of the following is a valid equation for Welsh consumer surplus with trade?

Accepted Answer

The equation for consumer surplus with trade is given by: Consumer surplus with trade = (1/2)(Q₁)(P₃ - P₁). This equation takes into account the quantity bought and the price paid by consumers after trade, as well as the price that consumers would have been willing to pay (based on the demand curve) before trade. Answer C is the only equation that includes these correct values.

Question 8

The before-trade price of fish in Germany is $8.00 per pound. The world price of fish is $6.00 per pound. Germany is a price-taker in the fish market. If Germany allows trade in fish, then Germany will become an

Accepted Answer

Since the world price of fish is lower than the before-trade price of fish in Germany, Germany will become an importer of fish if it allows trade. The new equilibrium price in Germany will be the world price of $6.00 per pound.

Question 9

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. 
-Refer to Figure 9-7. The equilibrium price and the equilibrium quantity of cheese in Wales before trade are

Accepted Answer

The answer of Figure 9-7. The figure applies to the...

Question 10

Figure 9-6
The figure illustrates the market for roses in a country. 
-Refer to Figure 9-6. The amount of deadweight loss caused by the tariff equals

Accepted Answer

The answer of Figure 9-6
The figure illustrates the market for...

Question 11

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. 
-Refer to Figure 9-7. Which of the following is a valid equation for the gains from trade?

Accepted Answer

The answer of Figure 9-7. The figure applies to the...

Question 12

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. 
-Refer to Figure 9-8. The country for which the figure is drawn

Accepted Answer

The diagram shows a downward-sloping demand curve and an upward-sloping supply curve, suggesting that the country is a price taker in the global market for cars. The equilibrium price is relatively high, suggesting that the country has a comparatively high production cost for cars. Therefore, the country has a comparative disadvantage in the production of cars and will likely import cars from other countries that have a comparative advantage in car production.

Question 13

The before-trade price of fish in Denmark is $10.00 per pound. The world price of fish is $6.00 per pound. Denmark is a price-taker in the fish market. If Denmark begins to allow trade in fish, its consumers of fish will become

Accepted Answer

The answer of The before-trade price of fish in Denmark...

Question 14

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. 
-Refer to Figure 9-8. When the country for which the figure is drawn allows international trade in cars,

Accepted Answer

When a country allows international trade in cars, both consumer and producer surplus increase. However, the increase in consumer surplus is greater than the increase in producer surplus, leading to an overall increase in total surplus. This increase in total surplus is represented by the area D on the diagram. Therefore, choice C is the correct answer.

Question 15

Figure 9-9 
-Refer to Figure 9-9. Consumer surplus in this market after trade is

Accepted Answer

The answer of Figure 9-9 
-Refer to Figure 9-9. Consumer...

Question 16

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. 
-Refer to Figure 9-7. With trade, the Welsh price of cheese and the Welsh quantity of cheese demanded are

Accepted Answer

With trade, the Welsh price of cheese will equal the world price (PS1=S1U1) and the Welsh quantity of cheese demanded will increase to the quantity where the domestic price equals the world price (QS1=S1U1). Therefore, the correct answer is P₁ and Q₁.

Question 17

Figure 9-6
The figure illustrates the market for roses in a country. 
-Refer to Figure 9-6. When the tariff is imposed, domestic consumers

Accepted Answer

When the tariff is imposed, the price of roses increases from $3.5 to $5 per dozen. Domestic consumers were initially consuming 800 dozen roses at a price of $3.5, so their total expenditure was 800 x $3.5 = $2,800. After the tariff, domestic consumers consume only 600 dozen roses at a price of $5 per dozen, so their total expenditure is 600 x $5 = $3,000. Therefore, domestic consumers lose $3,000 - $2,550 = $450.

Question 18

Figure 9-6
The figure illustrates the market for roses in a country. 
-Refer to Figure 9-6. When a tariff is imposed in the market, domestic producers

Accepted Answer

The answer of Figure 9-6
The figure illustrates the market for...

Question 19

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. 
-Refer to Figure 9-8. In the country for which the figure is drawn, total surplus with international trade in cars

Accepted Answer

The answer of Figure 9-8. On the diagram below, Q...

Question 20

Figure 9-9 
-Refer to Figure 9-9. Producer surplus in this market before trade is

Accepted Answer

The answer of Figure 9-9 
-Refer to Figure 9-9. Producer...

Quiz 9: Application: International Trade

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. Which of the following is a valid equation for Welsh producer surplus with trade?

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. -Refer to Figure 9-8. The price corresponding to the horizontal dotted line on the graph represents the price of cars

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. With trade, Wales

Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. The amount of revenue collected by the government from the tariff is

Figure 9-9 -Refer to Figure 9-9. Producer surplus in this market after trade is

Figure 9-9 -Refer to Figure 9-9. Consumer surplus in this market before trade is

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. Which of the following is a valid equation for Welsh consumer surplus with trade?

The before-trade price of fish in Germany is $8.00 per pound. The world price of fish is $6.00 per pound. Germany is a price-taker in the fish market. If Germany allows trade in fish, then Germany will become an

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. The equilibrium price and the equilibrium quantity of cheese in Wales before trade are

Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. The amount of deadweight loss caused by the tariff equals

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. Which of the following is a valid equation for the gains from trade?

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. -Refer to Figure 9-8. The country for which the figure is drawn

The before-trade price of fish in Denmark is $10.00 per pound. The world price of fish is $6.00 per pound. Denmark is a price-taker in the fish market. If Denmark begins to allow trade in fish, its consumers of fish will become

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. -Refer to Figure 9-8. When the country for which the figure is drawn allows international trade in cars,

Figure 9-9 -Refer to Figure 9-9. Consumer surplus in this market after trade is

Figure 9-7. The figure applies to the nation of Wales and the good is cheese. -Refer to Figure 9-7. With trade, the Welsh price of cheese and the Welsh quantity of cheese demanded are

Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. When the tariff is imposed, domestic consumers

Figure 9-6 The figure illustrates the market for roses in a country. -Refer to Figure 9-6. When a tariff is imposed in the market, domestic producers

Figure 9-8. On the diagram below, Q represents the quantity of cars and P represents the price of cars. -Refer to Figure 9-8. In the country for which the figure is drawn, total surplus with international trade in cars

Figure 9-9 -Refer to Figure 9-9. Producer surplus in this market before trade is